Social Media Influencers promoting Crypto-ICOs

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The US Securities and Exchange Commission (SEC) is actively combating crypto-initial offers (ICO) and a high-ranking official said earlier this year that dozens of cases were pending. [1

9659004] The SEC's next wave of enforcement, fueled by its recent agreement with professional boxer Floyd Mayweather and music producer DJ Khaled, is likely to be among social media influencers who have publicly publicized ICOs.

Writers, YouTube celebrities, cryptocurrency review platforms, publications, and many other individuals and organizations could be targeted by the SEC if there is sufficient evidence that an individual or An organization of ICO organizers has received compensation to promote a token sale without communicating the amount received from an ICO project to the target group.

"Any celeb or any other person promoting a virtual token or c A security that is a security must disclose the nature, amount and amount of compensation received in return for the promotion," said The SEC last year, stressing that the failure to disclose compensation is considered a fraudulent activity, and the SEC responded to its earlier statement by saying that investors need to be aware of celebrity branding in the blockchain The Commission said:

"Investors should be skeptical of the investment recommendations posted on social media platforms and not make decisions based on celebrities Social media influencers are often paid promoters, not investment specialists, and the securities for which they advertise, whether they are using traditional certificates or in the Blockch Ain can be fraudulent.

If a celebrity strongly encourages an ICO to receive a payment and the ICO is considered a security by the SEC, the SEC could consider the individual a violation of US securities laws.

Most ICOs are securities

. Coinbase, the largest fiat-to-crypto exchange in the US market, has worked with regulators to list additional digital assets on its platform.

In May, Coinbase announced a listing of Stellar (XLM) and Cardano (ADA). , 0x (ZRX), Zcash (ZEC) and Basic Attention Token (BAT). Nearly seven months forward, the stock market could add only three of the five crypto currencies that it intended to integrate.

Coinbase was cautious to ensure that a SEC's digital asset is not recognized as collateral In a hypothetical case that an asset listed by a stock exchange is declared as collateral by the US government, the stock market may be subject to unauthorized distribution unregistered securities should be prosecuted.

On Tuesday, Hacked.com reported that SEC Chairman Jay Clayton The Commission considers most ICOs on the world market to be securities:

"We do not believe Bitcoin is a security. Many of the ICOs you see and talk about are securities. And if you want to offer or sell securities, you must do so in accordance with our laws. We were aware that recent measures have further stressed that our securities laws should apply to the ICO area. If people want to raise money with the first coin deals, they must do so either through a private placement or register with the SEC. "

Promoting an ICO recognized as security without disclosing compensation to the target group could result in a penalty twice as high as the compensation itself, as is the case with Floyd Mayweather, who has over $ 600,000 to raise $ 300,000 has paid three ICOs.

Selected image from Shutterstock.

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